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NYC Lyft Launch Delayed Until At Least Monday, Attorney General Says

By Paul DeBenedetto | July 11, 2014 1:17pm | Updated on July 11, 2014 5:09pm
 Lyft cars, with their signature pink moustaches, are set to start offering rides Friday.
Lyft cars, with their signature pink moustaches, are set to start offering rides Friday.
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NEW YORK CITY — Under threat of a restraining order, the ride-sharing company Lyft halted their Friday launch in the city, the company confirmed.

Now, the company could lose its business in Buffalo and Rochester for encouraging drivers without hack and limousine licenses to pick up fares, the attorney general's office said.

Just hours before Lyft was set to launch service in Brooklyn and Queens, Attorney General Eric Schneiderman filed a restraining order in New York State Supreme Court. The AG took the company to task for attempting to operate in the city without proper licensing.

"As it has done in every other city in which it operates, [Lyft] has simply waltzed into New York and set up shop while defying every law passed whose very purpose is to protect the People of the State of New York," the court documents said.

"Despite being warned and told to cease and desist by three separate regulatory and enforcement agencies, defendant has thumbed its nose at the law and continued with its plan to launch in what could become its largest market."

A judge will continue to hear arguments for the restraining order on Monday, where the state will address Lyft's service both in New York City and upstate, Schneiderman's office said.

"We pursued this action only after repeatedly offering to work with Lyft in order to ensure that its business practices complied with the law," read a joint statement from Schneiderman and financial services Superintendent Benjamin Lawsky.

"Instead of collaborating with the State to help square innovation with statute and protect the public, as other technology companies have done as recently as this week, Lyft decided to move ahead and simply ignore state and local laws. Lyft’s arguments are a disingenuous attempt to disguise old-fashioned law-breaking that jeopardizes public safety."

On Monday morning, representatives from Lyft will meet with the city Taxi and Limousine Commission to discuss compliance with city regulations, TLC Chair Meera Joshi said.

Lyft spokeswoman Katie Dally said the company agreed to delay their kickoff until Monday's court hearing.

"...[We] hope to find a path forward for ridesharing in New York. Regarding enforcement efforts, as we work toward policy progress we'll stand with drivers every step of the way, defending any citations and covering relevant costs," Dally said.

The news of the restraining order comes after the city announced it would crackdown on the service if it launched Friday night at its originally scheduled time of 7 p.m.

In addition to its service in upstate New York, Lyft also operates in northern New Jersey and about 60 other cities across the country.

The company says they work on a volunteer and donation basis. Through its app users hail a "volunteer" driver and, once transported, pay a "donation" rather than a fare. Passengers know they're getting into a Lyft vehicle by the signature pink moustache on the front of the car.

Lyft competitor Uber, which already runs a heavily-regulated version of its service in the city, announced that it would seek to work around state laws if Lyft is allowed to launch.

"Due to TLC regulations Uber does not currently have a ridesharing platform in New York," Uber spokesman Lane Kasselman said.

"If regulators embrace ridesharing with a relaxed approach to licensing and enforcement with other companies, Uber will be excited to launch our ridesharing platform soon in the state of New York."

New York isn't the first city with which Lyft has gotten into hot water. A St. Louis circuit judge last month extended a restraining order against the company after the city's cab commission deemed the company a safety risk, according to reports.

Cabbies have also come out against Lyft's plan, including members of the New York State Federation of Taxi Drivers, who called Lyft's tactics something out of "the Wild West."

"Our licensed drivers get fined, cars taken away and sometimes arrested simply because they pick up an illegal street hail," NYSFTD president Antonio Cabrera said.

"Now Lyft comes along and breaks every rule in the book and we will not allow this to happen."

At a press conference Friday, NYSFTD spokesman Fernando Mateo said regulators should do everything they could to discourage the service.

"I don't understand how someone can come from Silicon Valley to New York City, put a pink moustache on their car and say they're going to pick up passengers," Mateo said. "It's ridiculous."